UnitedHealth to pay $500 million in hepatitis doctor case

Two UnitedHealth Group Inc. units are on the hook for more than $500 million in total damages, after a jury found that they failed to properly oversee a doctor who infected several patients with hepatitis C.

The jury handed down a $500 million punitive damages award less than a week after they ordered Health Plan of Nevada and Sierra Health Services to pay $24 million in compensatory damages. The $524 million in damages is the largest U.S. award so far this year, according to Bloomberg, although it’s a fraction of the $2.5 billion that the patients in the case were seeking.

Bonnie Brunson and Helen Meyer were among several patients who contracted hepatitis C after undergoing colonoscopies at gastroenterologist Depak Desai’s clinic. Subsequent investigations by federal state and local health authorities found that Desai engaged in “unsafe injection practices” at the Endoscopy Center of Southern Nevada, allegedly reusing syringes and medication vials.

Brunson and Meyer argued that the UnitedHealth units knew or should have known that Desai conducted speedy, sloppy procedures before they gave him a low-bid contract and began directing patients to him. This case could open the door for other plaintiffs seeking to hold insurance companies responsible for the misdeeds of health care providers, according to legal experts quoted in the Wall Street Journal.

The insurers, meanwhile, plan to appeal the damages. Their lawyers maintain that the units followed appropriate procedures when screening doctors for their networks, but that jurors were not allowed to hear that evidence. They also argue that Nevada officials “never uncovered any evidence of supposed wrongdoing” during their inspections of Desai’s practice.